3 Tactics to Maximize Your HRMS Software Investment

Average rating: 3 (from 65 votes)

By Dave Foxall

Aligning HR Processes With HRMS Software Capabilities

Realizing the numerous benefits that can accrue from HR Management System (HRMS) software is a continuous process, of which implementation is merely the first step. As SHRM (The Society for HR Management) reports, "A new [HRMS] will change the organization's HR practices and processes, so it is critical to evaluate the fit between the policies embedded in the new [system] and the organization's current ways of managing HR issues". The process is a balance between configuring the HR software to fit the organization's processes and reviewing how those processes could themselves be changed in a way that takes further advantage of the system.

HR Management System Improvement Tactic #1: Process Review

Following the structured HR software selection process review methodology of baseline analysis, future state analysis, and gap analysis, all HR procedures – from scheduling leave to succession planning – can be dismantled; compared to the organization's future requirements; and redesigned as necessary with automation in mind. It should be noted however that a strategic approach to this process is required. Namely, while potentially every procedure is a candidate for this re-design, factors such as time of year, organizational priorities and resources, and even corporate culture may influence the order of review. As the Society for Human Resource Management (SHRM) suggests, "when an organization adopts an [HRMS] that solution may have built in processes and procedures that are not compatible with existing practices and corporate culture. For example, an out-of-the-box application might require employees to seek managerial approval for time off, but the company's policy and culture may have no such requirement". As such, where the HR management system's standard processes clash with the way employees are used to working; those clashes are clear priorities for review or change. CedarCrestone's HR Systems Survey recommends a reasoned approach to this process review, citing "We recommend some business process improvement work where some processes may be standardized across the organization, but others remain optimized for a country or division."

HR Management System Improvement Tactic #2: Self-Service Applications

Employee and manager self-service software modules can both be incredibly strong drivers for process change. In large part this happens because as soon as a manager or employee is able to interact directly with the system (thusly cutting out the HR middle man) to conduct administrative HR transactions, the process changes. As Towers Watson's technology report (New Horizons, No Boundaries) states, self-service functionality has been identified as the second highest HRMS priority thanks to the widespread processes that are accessible through capabilities such as reviewing employee performance; viewing applicant resumes; initiating job requisitions; approving training; on-boarding new employees; and planning incentive pay. For new-adopting organizations in particular, these feature sets represent process changes that could be different due to HR technology and perhaps should be different in order to fully leverage the HR Management System.

HR Management System Improvement Tactic #3: Regulatory Compliance

Complying with labor law is a concern for organizations in any country but perhaps particularly so in the United States given the spate of data capture and reporting requirements from federal legislation such as COBRA, EEO, FMLA, and the more recent Patient Protection and Affordable Care Act. When state and local laws are added, the burden becomes ripe for automation and most HRMS solutions are geared to do just that—helping employers avoid significant fines and other penalties, and even costly employee lawsuits. Unfortunately, far too many organizations fail to leverage either these system capabilities or the vendor's expertise in compliance matters. As WAC Consulting highlights, "An [HR Management System] will help you determine which employment laws apply to your company and track the necessary information to comply with record keeping requirements." Furthermore, depending on the exact contractual and licencing arrangements, the HRMS supplier will ensure the software is kept updated and as tax and employment law changes, the system will keep pace.

Managing HR Management System Process Improvement

Countless studies have proven that the closer the alignment between an organization's processes and a given software's capabilities, the better the HRMS return on investment (ROI). However, automating fractured or inefficient processes only achieves those inefficiencies faster. As such, a best practice would be to review all processes on the grounds that the mere addition of technology does not ensure excellent HR performance or employee satisfaction with HR service delivery. Indeed, as Cedar Crestone highlights "The top initiative organizations work on is business process improvements [cited by 71% of respondents] such as process standardization where and when it makes sense. No organization can fix broken processes with automation". SHRM takes the sentiment one step further, citing for organizations to "Remember, e-HR is a powerful way to implement an HR strategy, but in and of itself, e-HR is not an HR strategy."